The hard drive on the DMS (their acronym for the cartridge, don't recall what it stands for) is definitely available to the OS when it is sitting in the cradle, and copying files to and from it is easy to do. Simply copying a new MP3 file to the DMS does not make it available to play, however.
Each audio file is associated with a 'Disc', which is essentially a playlist. Using the changer controls on your headunit, you can move from disc to disc, which gets you to the playlist you want. Track controls then move you from track to track within the playlist, as you would expect. If a given track is on the hard drive, but is not associated with a 'Disc', there is no way to access it. It's possible that each 'Disc' is defined using a standard m3u file format, but even if that is the case, additional information will be needed to store the sequence of the playlists.